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Issues: (i) whether furnace oil procured by a 100% Export Oriented Unit against CT3 certificate qualified as consumable and was eligible for exemption under Notification No. 1/95-C.E.; (ii) whether the longer period of limitation could be invoked.
Issue (i): whether furnace oil procured by a 100% Export Oriented Unit against CT3 certificate qualified as consumable and was eligible for exemption under Notification No. 1/95-C.E.
Analysis: The disputed furnace oil was used by a 100% EOU in its manufacturing activity. The issue had already been settled by prior Tribunal decisions holding that furnace oil used by a 100% EOU is consumable and, on that basis, eligible for the benefit of the exemption notification.
Conclusion: The furnace oil was held to be consumable and eligible for exemption under Notification No. 1/95-C.E., in favour of the assessee.
Issue (ii): whether the longer period of limitation could be invoked.
Analysis: The procurement of furnace oil against CT3 certificate was within the knowledge of the Central Excise authorities, the unit functioned under physical control, and the relevant bond had been duly approved. On those facts, suppression of information was not established.
Conclusion: Invocation of the extended period of limitation was not justified, in favour of the assessee.
Final Conclusion: The appeal failed on both limitation and merits, and the exemption benefit was sustained.
Ratio Decidendi: Furnace oil used by a 100% EOU is to be treated as consumable for the purpose of exemption, and the extended period cannot be applied when the facts were within the department's knowledge and no suppression is proved.
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